Thanks for the thorough review!
There are several points:
1. You are dying not only if the center thing hit but also if the circle shell hit. You are invincible when your shell becomes green (instead of cyan).
2. The yellow frame doesn't save you from bullets—it just provides cover. Bullets disappear when hit, but if you are in it and some part is outside, you will die.
3. Do you use Chrome? Sometimes, your browser's acceleration may be off; it is worth it (not only for our game) to turn it on! If you decide to turn it on, you can find the instructions in the game page description.